Joint Statement on the U.S.-Japan
Enhanced Initiative on Deregulation
and Competition Policy under the U.S.-Japan Framework
for a New Economic Partnership

(Issued on the occasion of the Japan-U.S. Summit Meeting)

June 19, 1997

I. Basic Principles

In today's increasingly integrated world economy, it is
becoming more important to address consumers' interests in
expanded choices of products and services that are readily
available at lower prices, through enhanced competition and
improved market access opportunities. With a view to meeting
consumers' interests and to improving market access for foreign
companies and foreign goods and services, the President and the
Prime Minister decided in April 1997 to strengthen the dialogue
between and reinforce the efforts of their governments with
regard to deregulation and competition policy under the
U.S.-Japan Framework for a New Economic Partnership
("Framework"). This Enhanced Initiative on Deregulation
and Competition Policy ("Enhanced Initiative") is
intended to carry out that decision.

The objective of the Enhanced Initiative, which will
address both sectoral and structural issues, is to conduct a
serious exchange of views and to undertake measures, as called
for in the Framework, to "address reform of relevant
government laws, regulations, and guidance which have the effect
of substantially impeding market access for competitive goods and
services" in order to enhance consumers' interests and to
increase efficiency and promote economic activity.

The Enhanced Initiative will be carried out through
meetings of the High-level Officials Group and expert-level
groups, described below, consistent with the principles of the
Framework, such as achievement of tangible progress, limiting
consultations to matters within the scope and responsibility of
government, the MFN principle, and the removal of sectoral and
structural impediments to expanded international trade and
nvestment flows. In addition, the meetings held under this
Enhanced Initiative will take place under the basic principle of
two-way dialogue.

II. The High-level Officials Group and Reports to the
Leaders of the Two Countries

A High-level Officials Group will be established to review
and comment on reports by the expert-level groups. The High-level
Officials Group will make utmost efforts to resolve any
outstanding issues forwarded by the expert-level groups.

The High-level Officials Group will be chaired by the
Deputy Minister, Ministry of Foreign Affairs (MOFA), and the
Deputy USTR. Other principal agencies participating in the
expert-level groups as described in Section III will be
represented by appropriately ranked officials from the GOJ and
the USG.

Meetings of the High-level Officials Group will be held
once a year, or more frequently as agreed by both sides.

The progress under the Enhanced Initiative will be
reported to the leaders of the two countries since the
strengthening of dialogue on deregulation is based on the
decision between the leaders of Japan and the United States, and
the promotion of deregulation and active implementation of
competition policy are issues of major importance to the GOJ.

III. Expert-level Groups

Overview

(1) Expert-level groups will be tasked with fulfilling
the objective of the Enhanced Initiative.

(2) Initially five expert-level groups will be included
within the Enhanced Initiative: four sectoral groups --
telecommunications, housing, medical
devices/pharmaceuticals, and financial services -- and
the Deregulation and Competition Policy Working Group
(the Working Group).

(3) Expert-level groups on other issues may be
established or otherwise brought under the Enhanced
Initiative in the future as agreed by both sides.

(4) Each expert-level group will decide the schedule
and items to be taken up in its group.

(5) Officials in charge of domestic regulations
within the scope of each expert-level group will
participate as appropriate.

(6) Each expert-level group will report in writing to
the High-level Officials Group, unless the expert-level
group decides otherwise.

Sectoral Groups

The two governments will use existing fora to the extent
possible, including the following:

(1) Deregulation in the telecommunications sector,
including the implementation of the GATS commitments on
basic telecommunications in each country, will be
addressed in the existing experts' group, co-chaired by
MOFA and the Ministry of Posts and Telecommunications for
the GOJ and by USTR for the USG.

(2) Deregulation in
the housing sector will be addressed in an expert-level
group at the occasion of the existing wood products
subcommittee, chaired by MOFA for the GOJ and USTR for
the USG. The housing expert-level group will be
co-chaired by MOFA and the Ministry of Construction for
the GOJ and by USTR for the USG.

(3) Deregulation in the medical
devices/pharmaceuticals sector will be addressed in the
existing MOSS medical devices/pharmaceuticals
consultations, chaired by the Ministry of Health and
Welfare for the GOJ and by the Department of Commerce
(DOC) for the USG.

(4) Deregulation in the financial services sector
will be addressed in the existing financial services
consultations, chaired by the Ministry of Finance (MOF)
for the GOJ and by the Department of Treasury for the
USG.

Deregulation and Competition Policy Working Group

(1) The two governments will continue to address
developments in the deregulation process within the
Deregulation and Competition Policy Working Group (the
Working Group), chaired by MOFA for the GOJ and by USTR
and the Department of Justice (DOJ) for the USG.

(2) Cross-sectoral issues will be addressed within the
Working Group as follows:

Structural issues such as competition policy and
distribution will be addressed in a subgroup that will be
established , to be co-chaired by MOFA, MOF, the Ministry
of International Trade and Industry, the Ministry of
Transport and the Japan Fair Trade Commission for the GOJ
and by the Department of State and DOJ for the USG.

Issues related to transparency and other government
practices will be addressed in the Working Group, which,
for the purposes of this dialogue will be chaired by MOFA
for the GOJ and by DOC for the USG.

(3) Other issues on deregulation which are not
discussed in other expert-level groups may also be taken
up within the Working Group.